Is the industrial market showing any signs of a slowdown at the start of 2017? Not in any of the Midwest’s major markets.
The latest research from Cushman & Wakefield is just the latest sign that industrial markets across the region are thriving today. Cushman & Wakefield reported that the industrial market in the Kansas City area enjoyed a record-setting year in 2016, with the recently completed fourth quarter ranking as the strongest.
According to Cushman & Wakefield, the Kansas City industrial real estate market absorbed an all-time high of 5.5 million square feet in 2016. And this market saved the best for last, with 1.8 million square feet of industrial space absorbed during the fourth quarter alone.
“The market is as strong as it has ever been,” said Michael Mayer, Cushman & Wakefield managing principal, in a statement.
The vacancy rate at the end of 2016 fell to 8.3 percent for the Kansas City industrial market. That was actually a full point higher than at the end of 2015, thanks largely to the delivery of 8.3 million square feet of new space in 2016. A total of 3.8 million square feet of this space was delivered in the fourth quarter alone, according to Cushman & Wakefield.
The Johnson County submarket of Kansas City remained the strongest performer in the market, with 1.8 million square feet of positive absorption in the fourth quarter and 4 million for the entire year.
According to Cushman & Wakefield, this hot streak isn’t about to end. The company reported that there are plenty of reasons to be optimistic about the future of the Kansas City industrial market as 2017 progresses. Build-to-suit projects totaling 3.1 million square feet are currently underway for Amazon, Sioux Chief, Garmin and General Motors, while ongoing speculative construction totaled 3.9 million square feet at the end of 2016.